Getting approved for a car loan when you have bad credit might seem impossible — but it’s not. At Get Approved Loans, we compare over 60 Australian lenders to help you find options that work, even if your credit history isn’t perfect.
What Is a Bad Credit Car Loan?
A bad credit car loan is designed for Aussies who’ve had some financial speed bumps in the past — missed repayments, defaults, or even bankruptcy. These loans often come with higher interest rates or stricter terms, but they can help you rebuild your credit over time while getting you behind the wheel.
What Are My Options?
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Secured Car Loans
Ideal if you’re buying a new or near-new vehicle. The car acts as collateral, reducing risk for lenders — and often lowering your interest rate. -
Unsecured Personal Loans
If you’re buying an older car or want to borrow extra for rego, insurance, or repairs, this could be an option. Just note: unsecured loans usually come with higher rates.
Improve Your Approval Odds
Check your credit report for errors
Offer a larger deposit
Apply with a co-signer or guarantor
Stick to lenders who specialise in non-prime credit
Car Loan vs Personal Loan — Which Is Better?
A car loan (especially a secured one) usually offers better rates than a personal loan. But a personal loan may give you more flexibility if you’re buying privately or need extra funds for other expenses.
Explore the pros and cons of both in our Car Loan vs Personal Loan Guide.
What About the Big 4 Banks?
If your credit score is low, the Big 4 banks — CommBank, ANZ, Westpac, and NAB — may not be your best bet. Most have strict lending criteria. That’s where Get Approved Loans shines — we work with specialist lenders who look beyond just your credit score.
Balloon Payments — Good or Bad?
A balloon payment can lower your monthly repayments, but it means you’ll owe a lump sum at the end of the loan. For borrowers with bad credit, this could be risky unless you’re planning to upgrade or sell the car before the final payment is due.
Car Loan Vs Personal Loan Feature Comparison
| Feature | Car Loan | Personal Loan |
|---|---|---|
| Best Use | Designed specifically for buying new or near-new vehicles | Versatile — use for a car, debt consolidation, or other personal expenses |
| Interest Rates | Often lower due to the loan being secured by the vehicle | Rates may be higher, especially for applicants with previous credit issues |
| Car Age Restrictions | Generally limited to brand new or late-model cars | Older, used cars usually accepted — ideal for bad credit borrowers |
| Loan Flexibility | Typically matches the vehicle’s market value | Can include additional funds for rego, insurance, or unexpected costs |
| Balloon Payments | Some lenders offer this to reduce monthly repayments |
